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Abstract
We study the structure and performance of the coffee export sector in Ethiopia, Africa’s most
important coffee producer, over the period 2003 to 2013. We find an evolving policy environment
leading to structural changes in the export sector, including an elimination of vertical
integration for most exporters. Ethiopia’s coffee export earnings improved dramatically over this
period, i.e. a four-fold real increase. This has mostly been due to increases in international
market prices. Quality improved only slightly over time, but the quantity exported increased by
50 percent, seemingly explained by increased domestic supplies as well as reduced local
consumption. To further improve export performance, investments to increase the quantities
produced and to improve quality are needed, including an increase in washing, certification, and
traceability, as these characteristics are shown to be associated with significant quality premiums
in international markets.